Speech by SPS Tan Wu Meng at Offshore Southeast Asia (OSEA) 2018

Speech by SPS Tan Wu Meng at Offshore Southeast Asia (OSEA) 2018

1.I am pleased to join you today for the opening of Offshore Southeast Asia (OSEA) 2018.

2.I’m very glad to see many of you here today. Discussing the latest trends, challenges and opportunities in Oil & Gas in Asia and beyond. OSEA2018 is hosting close to 1,000 companies from about 40 countries and regions, including 16 International Pavilions.

The M&OE industry is on the road to recovery

3.Singapore’s achievement in the Marine & Offshore Engineering (M&OE) industry was built on the contributions of our workers – our brothers and sisters in the Labour Movement, in partnership with resilient and ambitious companies. Fifty years ago, Singapore was a small regional ship repair and building centre with four domestic marine firms. Today, Singapore is a global leader in offshore engineering and construction, as well as the design and manufacture of new builds and conversion vessels. We have grown a strong ecosystem to support the industry – more than 1,000 SMEs and companies, including leading solution providers. In 2017, the M&OE industry contributed S$2.7 billion to Singapore’s GDP, S$9.8 billion to Singapore’s total manufacturing output and employed more than 24,000 local workers. This was despite the current global headwinds facing the industry.

4.When the last OSEA conference took place in 2016, the M&OE industry was in a deep, prolonged slowdown. Cyclical and structural forces had come together at the same time.
The last three years have been difficult times for the industry. While we have not completely recovered from the slowdown and there are uncertainties and challenges ahead, we are beginning to see some light at the end of the tunnel. Compared to this time last year, Singapore’s M&OE sector posted year-on-year growth over the past two quarters.

5.Looking towards 2019, we expect growing interest in Liquefied Natural Gas (LNG) as global energy demand increases. Asia in particular is expected to be the most important demand market for LNG going forward. Singapore can be an LNG hub for the region, and we now have over 45 companies with LNG trading or business development here. We expanded our LNG storage capacity ahead of domestic demand. This capacity can be used for physical LNG trades. Our M&OE companies have the capability to build offshore structures and support offshore projects – this will help them capture opportunities in the sector.

The Singapore Government will continue to support our companies and our workers in the industry

6.Since December 2016, the Government has been supporting M&OE companies through a sector-specific Bridging Loan (BL) and Internationalisation Finance Scheme (IFS) to tide through the downturn. The aim is to help preserve core capabilities in Singapore-based M&OE companies. Working capital and financing can help support operations through the downturn. The two schemes, administered in partnership with local financial institutions, have provided more than S$700 million in loans to more than 100 unique borrowers to date, the majority of which are SMEs.

7.The financing measures have supported the industry together with the broader M&OE Industry Transformation Map (ITM) launched earlier this year. The ITM aims to help our brothers and sisters in the M&OE workforce. Helping our brothers and sisters to build relevant skills. Helping our companies compete through innovation and productivity. Helping unions and trade associations work closer together. Helping our industry to grow. Together, we hope to create 1,500 new jobs by 2025 for the M&OE industry and contribute S$5.8 billion to our GDP.

8.The Government is working with partners to support our workers to build up skills, to meet the changing needs of the M&OE industry.

a.One support measure is the Professional Conversion Programme (PCP) for Marine Industry. Workforce Singapore (WSG) has been working closely with unions and trade associations to help companies support workers better. Supporting re-skilling and upgrading of PMET employees through the PCP.

b.To help our workers build mastery in skills, as part of lifelong learning, the Government has launched the Skills Framework for Marine and Offshore. This framework was jointly developed by SkillsFuture Singapore (SSG), WSG, the Economic Development Board and Enterprise Singapore. A team effort between Government, industry associations, training providers, organisations and unions, it serves as a resource and planning guide for individuals, employers and training providers. It also highlights the required skills for growth areas such as digitalisation and renewables.

c.In addition, our unions in the Marine Engineering Cluster are helping our workers. I am an Advisor to the Shipbuilding & Marine Engineering Employees’ Union (SMEEU). SMEEU has used the Skills Framework to help companies with resource management and talent development. SMEEU also worked with e2i to organise the M&OE month in August 2018. The event focused on digitalisation of the industry. It gave management partners the opportunity to see how Industry 4.0 affects the sector.

9.Against this backdrop of growth and transformation, I am glad to see that OSEA2018 continues to provide a platform for key industry and Government stakeholders across the globe to come together and discuss emerging themes. Developments in cyber security, digital oilfield, data analytics and predictive maintenance are likely to profoundly impact the Oil & Gas sectors in the years to come. To remain competitive, businesses will need to review their strategies and business models, upskill their workers, and adapt to new trends.

Conclusion

10.I am encouraged that OSEA2018 continues to enjoy the active participation of Singaporean SMEs, making Singapore’s international pavilion the largest with almost 50 exhibitors. This shows the OSEA conference’s strength as a platform for Singaporean SMEs to showcase innovative solutions and high-end precision engineering capabilities to the international Oil & Gas community.

11.To our delegates, I hope that the next three days will bring you opportunities to develop meaningful partnerships and give you invaluable insights to enrich the overall Oil & Gas landscape, both here and on the global stage.